Based on the committee's investigation and two separate
court rulings, it is clear that high level Department of
Justice officials deliberately ignored INSLAW's proprietary
rights in the enhanced version of PROMIS and misappropriated
this software for use at locations not covered under
contract with the company. Justice then proceeded to
challenge INSLAW's claims in court even though it knew that
these claims were valid and that the Department would most
likely lose in court on this issue. After almost 7 years of
litigation and $1 million in cost, the Department is still
denying its culpability in this matter. Instead of
conducting an investigation into INSLAW's claims that
criminal wrongdoing by high level Government officials had
occurred, Attorney Generals Meese and Thornburgh blocked or
restricted congressional inquiries into the matter, ignored
the findings of two courts and refused to ask for the
appointment of an independent counsel. These actions were
taken in the face of a growing body of evidence that serious
wrongdoing had occurred which reached to the highest levels
of the Department. The evidence received by the committee
during its investigation clearly raises serious concerns
about the possibility that a high level conspiracy against
INSLAW did exist and that great efforts have been expended
by the Department to block any outside investigation into
the matter.
Based on the evidence presented in this report, the
committee believes that extraordinary steps are required to
resolve the INSLAW issue. The Attorney General should take
immediate steps to remunerate INSLAW for the harm the
Department has egregiously caused the company. The amount
determined should include all reasonable legal expenses and
other costs to the Hamiltons not directly related to the
contract but caused by the actions taken by the Department
to harm the company or its employees. To avoid further
retaliation against the company, the Attorney General should
prohibit Department personnel who participated in any way in
the litigation of the INSLAW matter from further involvement
in this case. In the event that the Attorney General does
not move expeditiously to remunerate INSLAW, then Congress
should move quickly under the congressional reference
provisions of the Court of Claims Act to initiate a review
of this matter by that court.
Finally, the committee believes that the only way the
INSLAW allegations can be adequately and fully investigated
is by the appointment of an independent counsel. The
committee is aware that on November 13, 1991, newly
confirmed Attorney General Barr finally appointed Nicholas
Bua, a retired Federal judge from Chicago, as his special
counsel to investigate and advise him on the INSLAW
controversy. However, at that time the Attorney General had
not empowered Judge Bua to subpoena witnesses, convene a
grand jury or compel the Department to produce key
documents.
INSLAW officials have voiced concerns that Judge Bua,
lacking independent counsel status, would not be able to
entice Department employees who were knowledgeable of the
INSLAW matter to come forward and assist Judge Bua in
bringing this matter to closure. Consequently, they are
concerned that Judge Bua will not be
able to get to the bottom of the matter, and they believe
his investigation will end up being subverted by the
Department.
The inability to subpoena and/or to convene a grand jury
was apparently of concern to Judge Bua and, after a meeting
on January 28, 1992, the Attorney General granted Judge Bua
broad investigative authority which included the power to
subpoena witnesses and to convene special grand juries.
However because of the actions by the Department regarding
potential whistleblowers such as Anthony Pasciuto, it is
very likely witnesses will still feel intimidated by the
Department. This problem was present throughout the
committee's investigation and remains a potential problem
today.
Without independent counsel status, Judge Bua remains an
employee of the Department of Justice. The image problem is
illustrated in a recent interview with Roger M. Cooper,
Deputy Assistant Attorney General for Administration. In an
interview with the Government Computer News, Mr. Cooper
stated that:
The judge (Bua) will do as the attorney general
wants him to do, and that's fine. I think all of
us in the department would like to get it [the
INSLAW matter] behind us. It's sort of an
albatross.
Mr. Cooper may have meant that Attorney General Barr
wants Judge Bua to conduct a thorough investigation. The
committee has no reason to doubt the commitment of Judge Bua
or Attorney General Barr to do a thorough investigation of
this matter-the problem rests with the fact that, as long as
the investigation of wrongdoing by former and current high
level Justice officials remains under the control of the
Department, there will always be serious doubt about the
objectivity and thoroughness of the work.
This matter has caused great harm to several individuals
involved and has severely undermined the Department's
credibility and reputation. Congress and the executive
branch must take immediate and forceful steps to restore the
public confidence and faith in our system of justice which
has been severely eroded by this painful and unfortunate
affair. As such, the independent counsel should be appointed
with full and broad powers to investigate all matters
related to the allegations of wrongdoing in the INSLAW
matter, including Mr. Casolaro's death and its possible link
to individuals associated with organized crime.
X. FINDINGS
1. The Department, in an attempt to implement a
standardized case management system, ignored advice from
vendors-including INSLAW-that PROMIS should not be adapted
to word processing equipment. As predicted, problems arose
with adapting PROMIS to word processing equipment. The
Department immediately set out to terminate that portion of
the contract and blamed INSLAW for its failure.
2. The Department exhibited extremely poor judgment by
assigning C. Madison Brewer to manage the PROMIS
implementation contract. Mr. Brewer had been asked to leave
his position as general counsel of INSLAW under strained
relations with INSLAW's owner, Mr. William Hamilton.
INSLAW's problems with the Department, which started almost
immediately after the award of the
contract in March 1982, were generated in large part by
Mr. Brewer, with the support and direction of high level
Department officials. The potential conflict of interest in
the hiring of Mr. Brewer was not considered by Department
officials. However, Mr. Brewer's past strained relationship
with Mr. Hamilton, and the fact that he lacked experience in
ADP management and understanding of Federal procurement
laws, raises serious questions about why he was selected as
the PROMIS project manager.
3. Mr. Brewer's attitude toward INSLAW, combined with Mr.
Videnieks' harsh contract philosophy, led to the rapid
deterioration of relations between the Department and
INSLAW. Any semblance of fairness by key Department
officials toward INSLAW quickly evaporated when Mr. Hamilton
attempted to protect his companies' proprietary rights to a
privately funded enhanced version of the PROMIS software. In
a highly unusual move, Mr. Brewer recommended just 1 month
after the contract was signed that INSLAW be terminated for
convenience of the Government even though INSLAW was
performing under the contract. From that point forward there
is no indication that Mr. Brewer or Mr. Videnieks ever
deviated from their plan to harm INSLAW. The actions taken
by Messrs. Brewer and Videnieks were done with the full
knowledge and support of high level Department officials.
4. Peter Videnieks, the Department's contracting officer,
negotiated Modification 12 of the contract which resulted in
INSLAW agreeing to provide its proprietary Enhanced PROMIS
software for the Department's use. This negotiation was
conducted in bad faith because Justice later refused to
recognize INSLAW's rights to privately financed PROMIS
enhancements. Mr. Videnieks and Mr. Brewer, supported by
Deputy Attorney General Jensen and other high level
officials, unilaterally concluded that the Department was
not bound by the property laws that applied to privately
developed and financed software.
6. Thereafter, the Department ignored INSLAW's data
rights to its enhanced version of its PROMIS software and
misused its prosecutorial and litigative resources to
legitimize and coverup its misdeeds. This resulted in
extremely protracted litigation and an immense waste of
resources both for the Government and INSLAW. These actions
were taken even though the Department had already determined
that INSLAW's claim was probably justified and that the
Department would lose in court. In fact, Deputy Attorney
General Burns acknowledged this fact to OPR investigators.
6. Department of Justice documents show that a "public
domain" version of the PROMIS software was sent to domestic
and international entities including Israel. Given the
Department's position regarding its ownership of all
versions of PROMIS, questions remain whether INSLAW's
Enhanced PROMIS was distributed by Department officials to
numerous sources outside the Department, including foreign
governments.
7. Several witnesses, including former Attorney General
Elliot Richardson, have provided testimony, sworn statements
or affidavits linking high level Department officials to a
conspiracy to steal INSLAW's PROMIS software and secretly
transfer PROMIS to Dr. Brian. According to these witnesses,
the PROMIS software was subsequently converted for use by
domestic and foreign intelligence
services. This testimony was provided by individuals who
knew that the Justice Department would be inclined to
prosecute them for perjury if they lied under oath. No such
prosecutions have occurred.
8. Justice had made little effort to resolve conflicting
and possibly perjurious sworn statements by key departmental
witnesses about the alleged attempt by high level Department
officials to liquidate INSLAW and steal its software. It is
very possible that Judge Blackshear may have perjured
himself and even today his explanations for his recantation
of his sworn statement provided to INSLAW are highly
suspicious. The investigation of this matter by the
Department's Office of Professional Responsibility was
superficial.
9. The Department's response to INSLAW's requests for
investigations by an independent counsel and the Public
Integrity Section was cursory and incomplete
10. The reviews of the INSLAW matter by Congress were
hampered by Department tactics designed to conceal many
significant documents and otherwise interfere with an
independent review. The Department actions appear to have
been motivated more by an intense desire to defend itself
from INSLAW's charges of misconduct rather than
investigating possible violations of the law.
11. Justice officials have asserted that, as a result of
the recent ruling by the Appeals Court and the refusal of
the Supreme Court to hear INSLAW's appeal, the Findings and
Conclusions of Bankruptcy Judge George Bason and senior
Judge William Bryant of the District Court are no longer
relevant. The Appeals Court decision, in fact, did not
dispute the Bankruptcy Court's ruling that the Department
"stole É through trickery, fraud and deceit" INSLAW's PROMIS
software. Its decision was based primarily on the narrow
question of whether the Bankruptcy Court had jurisdiction;
the Appeals Court ruled that it did not. This decision in no
way vindicates the Department nor should it be used to
insulate Justice from the criticism it deserves over the
mishandling of the INSLAW contract.
12. The Justice Department continues to improperly use
INSLAW's proprietary software in blatant disregard of the
findings of two courts and well established property law.
This fact coupled with the general lack of fairness
exhibited by Justice officials throughout this affair is
unbefitting of the agency entrusted with enforcing our
Nation's laws.
13. Further investigation into the circumstances
surrounding Daniel Casolaro's death is needed.
14. The following criminal statutes may have been
violated by certain high level Justice officials and private
individuals:
18 U.S.C. ¤ 371-Conspiracy to commit an offense.
18 U.S.C. ¤ 654-Officer or employee of the
United States converting the property of
another.
18 U.S.C. ¤ 1341-Fraud.
18 U.S.C. ¤ 1343-Wire fraud.
18 U.S.C. ¤1505-Obstruction of proceedings
before departments, agencies and committees.
18 U.S.C. ¤ 1512-Tampering with a witness.
18 U.S.C. ¤ 1513-Retaliation against a witness.
18 U.S.C. ¤ 1621-Perjury.
18 U.S.C. ¤ 1951-Interference with commerce by
threats or violence (RICO).
18 U.S.C. ¤ 1961 et seq.-Racketeer Influenced
and Corrupt Organizations.
18 U.S.C. ¤ 2314- Transportation of stolen
goods, securities, moneys.
18 U..S.C. ¤ 2315-Receiving stolen goods.
15. Several key documents subpoenaed by the committee on
July 26, 1991, were reported missing or lost by the
Department. While Justice officials have indicated that this
involves only a limited number of documents, it was
impossible to ascertain how many documents or files were
missing because the Department did not have a complete index
of the INSLAW materials. The Department failed to conduct a
formal investigation to determine whether the subpoenaed
documents were stolen or illegally destroyed.
XI. RECOMMENDATIONS
1. The committee recommends that Attorney General Barr
immediately settle INSLAW's claims in a fair and equitable
manner.
These payments should account for the Department's
continued unauthorized use of INSLAW's Enhanced PROMIS and
other costs attributed to INSLAW's ongoing attempt to obtain
a just settlement for its struggle with the Department,
including all reasonable attorneys' fees. If there continue
to be efforts to delay a fair and equitable result, the
committee should determine whether legislation is required
to authorize a claim by INSLAW against the United States,
pursuant to 28 U.S.C. ¤ 1492.
2. The Attorney General should require that any person in
the Department that participated in any way in the
litigation of the INSLAW matter be excluded from further
involvement in this case, with the exception of supplying
information, as needed, to support future investigations by
a independent counsel or litigation, as appropriate.
3. The committee strongly recommends that the Department
appoint an independent counsel to conduct a full, open
investigation of the INSLAW allegations of a high level
conspiracy within the Department to steal Enhanced PROMIS
software to benefit friends and associates of former
Attorney General Meese, including Dr. Earl Brian, as
discussed in this report. Among other matters, the
investigation should also:
Ascertain whether there was a strategy by former
Attorneys General and other Department officials
to obstruct this and other investigations through
employee harassment and denial of access to
Department records.
Investigate Mr. Casolaro's death.
Determine whether current and former Justice
Department officials and others involved in the
INSLAW affair resorted to perjury and obstruction
in order to coverup their misdeeds.
Determine whether the documents subpoenaed by
the Committee and reported missing by the
Department were stolen or illegally destroyed.
Determine if private sector individuals
participated in (1) the alleged conspiracy to
steal INSLAW's PROMIS software and distribute it
to various locations domestically and overseas,
and (2) the alleged coverup of this conspiracy
through perjury and obstruction.
Determine if other criminal violations occurred
involving:
18 U.S.C. ¤ 371-Conspiracy to commit an offense.
18 U.S.C. ¤ 654-0fficer or employee of the
United States converting the property of
another.
18 U.S.C. ¤ 1341-Fraud.
18 U.S.C. ¤ 1343-Wire fraud.
18 U.S.C. ¤ 1505-Obstruction of proceedings
before departments, agencies and committees.
18 U.S.C. ¤ 1512-Tampering with a witness.
18 U.S.C. ¤ 1513-Retaliation against a witness.
18 U.S.C. ¤ 1621-Perjury. 18 U.S.C.
¤1951-Interference with commerce by threats or
violence (RICO).
18 U.S.C. ¤ 1951 et seq.-Racketeer Influenced
and Corrupt Organizations.
18 U.S.C. ¤ 2314-Transportation of stolen goods,
securities, moneys.
18 U.S.C. ¤ 2315-Receiving stolen goods.